California’s broken health care system hurts the 20 million Californians who buy insurance or get coverage through their jobs.

Insured Californians pay a hidden tax to subsidize care for the uninsured.

• The hidden tax increases health care premiums. The hidden tax constitutes 17 percent of health care premiums in California. The New America Foundation found that the hidden tax on health care premiums equals $455/individual and $1,186/family annually.
• The uninsured raise premiums for the insured by ten percent. Health care providers who treat the uninsured are not fully reimbursed for the cost of care, forcing them to shift costs. This has resulted in an approximate 10 percent increase in premiums for all Californians. Medi-Cal under-funding contributes the other 7 percent.

Billions of dollars in unpaid medical bills are passed on to insured Californians.

• Higher deductibles, higher premiums and higher co-pays are the result. When health care providers shift costs, those with insurance pay. Why? Providers set prices for the insured that are higher than their costs. In short, the insured pick up the difference.
• The insured bear the brunt of cost increases. According to The Rand Corporation, HMO premiums rose nearly 50 percent between 1997 and 2002, and the average annual increase in health insurance costs is 11 percent.
• health care costs outpace inflation and wage growth. In California, health care costs are rising faster than increases in workers’ pay and the costs of other goods and services.

Californians worry about affording health insurance and fear losing it if they get sick.

• Three in four voting Californians are “Worried Well.” According to the January 2007 Field Poll, more than 77 percent of voters worry that they won’t be able to pay their medical bills due to a major illness of injury, and 75 percent are concerned their employers will cut back on premium contributions . Insurance experts call this population the “Worried Well.”
• 62 percent fear a pre-existing condition will keep them from getting insurance. Their fears are well founded: thousands of Californians who have pre-existing health conditions such as diabetes, cancer or heart disease—or take anti-asthma, anti-depressant, or hundreds of other medications—are often turned down when they try to purchase private health insurance, are granted only partial coverage, or offered only extremely high rates.

Governor Schwarzenegger’s reforms will bring economic relief to insured Californians, and ensure that everyone can get coverage.

Costs will drop when all Californians have coverage.

• These reforms will get patients out of the emergency room and into their doctor’s office. The Governor’s individual mandate requires that all Californians obtain health insurance. This gives all Californians access to regular medical care, reducing the need for emergency treatment and helping patients manage chronic conditions more effectively.

The Governor's health care reforms guarantee that all Californians can get health care coverage.

• Every individual will be able to buy coverage. Governor Schwarzenegger's reforms include a provision that guarantees an individual will be able to obtain a health insurance policy in the individual market.
• Medical history will no longer be a barrier. Insurers will be required to guarantee coverage, with limits on how much they can charge based on age or health status, so that all individuals have access to affordable products.
• Low-income Californians have help. Those who can’t afford coverage or who don’t receive it through their employers will be able to buy it through a special purchasing pool.

A majority of Californians support the Governor’s health care reforms.

• Californians understand that our health care system is broken. A January 2007 poll by the Public Policy Institute of California showed that the majority of Californians support the Governor’s reforms.
• Support crosses party lines. 79 percent of Democrats, 55 percent of Republicans, 68 percent of independents and 65 percent of all likely voters reported supporting Governor Schwarzenegger’s reforms.